The crisis in the Eurozone has left Spanish families sleeping rough on the
streets of London, Boris Johnson has said.

The euro has been a “real disaster” for the people of Europe and resulted in families from Malaga living destitute by the capital's canals, the Mayor of London said.

“I was going along the canal the other day on my bike, and I came across a family from Spain. I’d never seen in all my time as mayor a Spanish family destitute and homeless in London before,” Mr Johnson told the Institute of Directors conference.

“They have every right to come and seek work in the UK under the single market treaty. But it really brought home to me the disaster of the euro.

“The guy was from Malaga. He was in construction. He had absolutely lost hope of finding anything – unemployment there is about 40 per cent. And he’d washed up in Hackney and I felt it was a real tragedy," he said.

"The guy could barely speak English. You wouldn't have had that ten years ago before the euro began. The politicians of Europe do no have the answer."

“So when Barroso [the President of the European Commission] tells us we are going to go back to World War One unless we go full tilt to the European Union, I have to say they need to think again. This whole euro project has been a real disaster for the union and it will take a very, very long time to sort out.”

Last year more than 730 people from western Europe slept rough in London, up more than double from 320 in 2010 as the euro crisis began. They included 131 people from Portgual, 62 from Spain, 150 from Ireland and 15 from Greece. The numbers of homeless Italians has tripled from 41 to 112.

In the same period, the number of homeless British people sleeping rough in the capital has increased from 1700 to 2923, while the number of eastern Europeans has increased from 845 to 1772.

Mr Johnson said visa laws in Britain must be flexible since more Chinese tourists now go to Brussels than to London.

“Chinese tourists are very, very lucrative sources of revenue for our capital. We would want to encourage that. There is a case for much, much greater flexibility on those kinds of issues, without prejudicing the right of the state to be much tougher on illegal immigrants.”

The Mayor said EU regulations on workplaces had become “grossly onerous” and need to be pared back.